) recently announced that it has received recognition for its
OmniRx automated dispensing system from leading research firm, KLAS
for the seventh consecutive year. With the 2012 "Best in KLAS"
award, Omnicell's Automated Medication Dispensing Units have
emerged as the leader for the third consecutive year. The company
was also acknowledged for its WorkflowRx Carousel and OmniLinkRx
for the third consecutive year.
The KLAS awards that recognize excellence in respective markets,
are generally attributed based on data from customer surveys of
hospital and clinic executives, administrators, physicians, nurses
and others interacting with healthcare equipment and infrastructure
solutions. Thus, Omnicell remains optimistic that with these new
awards, more institutes will come up to switch over to the
automated mode by procuring medication and supply solutions to
address the shortage of nursing facilities in the US, thereby
driving the demand for its offerings.
Omnicell primarily operates in the niche automated medication
distribution industry and stands to benefit from favorable
demographic trends, regulatory environments, and the lack of
nursing staff. As the information technology market is growing in
leaps and bounds with increased investment by healthcare industries
and gradual modernization of the healthcare system, the demand for
automated healthcare management systems has also been on the rise.
The company expects its customers to save up to 70% to 80% of their
investment while upgrading their installed systems to
next-generation G4 product platform.
Furthermore, the company is hyper active on the acquisition front
and has won a number of deals. With the acquisition of MTS
Medication Technologies in May 2012, Omnicell plans to become a
market leader for medication management solutions across the broad
range of health care beyond the acute care setting. The company
also expects this to deliver superior results and reduce costs
However, the company's products, primarily catering to hospitals
and nursing homes, are still suffering from weak credit markets and
higher unemployment. Constrained hospital spending is a primary
headwind for the company. Moreover, the company faces intense
competition in the medication management and supply chain solutions
market from major players such as
Currently, Omnicell retains a short-term Zacks #3 Rank (Hold).
Over the long term we are Neutral on the stock.
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